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Decoding the Digital Retailing Puzzle

Balancing the eCommerce Versus Showroom Experience

By: Russ Chandler

For the longest time, consumers who were ready to buy a car physically went to your dealership. They developed a relationship with the dealers there, and they were catered to throughout every step of the process: from initial interest (research) to financing, and of course, to actual purchase.

Fast forward 15 years and you’ll discover that most, if not ALL consumers are conducting their research online. And why wouldn’t they? Why would anyone want to be bombarded by a salesman when they don’t even know what they want? The internet has made researching for the perfect vehicle that much easier for consumers.

Given all the recent advances in technology, it’s now entirely possible to go through the whole purchase process online. Not only can you look for a vehicle online, but you can apply for financing and even purchase one as well.

Now, despite this newfound ability to turn your dealership into a full-on commerce website, you probably don’t want it to be the primary way you capture new car sales leads or sell cars. Despite the convenience technology brings, many consumers would absolutely prefer to speak directly with a representative and test drive a vehicle (in-store) before signing on the dotted line for such a large investment.

The point here is that staying completely on the left (the heavier eCommerce side), or staying completely on the right (the physical showroom side) of the spectrum isn’t the most practical decision in the world.

When it comes to making bigger, more informed decisions, it helps to be somewhere in the middle of the spectrum. Although you certainly want your consumers to have control over their purchasing journey, it’s also important to realize that consumers might need help along the way too.

As a general rule-of-thumb, your dealership should place itself somewhere in the middle of the spectrum. It certainly doesn’t need to be completely dead-center — but if you’re like most dealerships and you have an at least somewhat diverse consumer-base, you want to balance out how much your technology is amplified on your dealership’s website.

When it comes to overall dealership presentation, one of the biggest questions that comes up is “how focused do I want to be on creating an independent eCommerce website?” Or rather, two questions — as dealers will likely also ask “how focused do I want to be on my actual showroom customer service experience?” These are both incredibly important questions; because the answer is based on the dealership’s consumer base.

Are You Left or Right of Center?

While you certainly don’t want to be too far to the left (only focusing on eCommerce), you don’t want to be too far to the right either (only focusing on your showroom). We’ve already established that you want to be somewhere in the middle, but exactly where on that spectrum do you want to be? To you want to be left of center or more right of center? How far away do you want to be from the center?

To answer these questions (and more), you need to meticulously think about the benefits and pitfalls of each side. What benefits does your dealership stand to gain from being on the left hand side? What benefits does it stand to gain further right? Here are a few things to think about before you move forward with a strategy:

What Will Happen with a Heavier ecommerce Strategy?

One of the most prominent benefits of sticking to a heavier ecommerce strategy is that you’re giving consumers more control. They have control over the results they receive and they have control over the next steps.

Because they aren’t speaking to anyone just yet, they have more opportunity to make a decision that completely suits their needs. There’s no outside influence to make them feel rushed or intimidated.

Because consumers like the concept of making decisions on their own, your dealership can take advantage of this by creating online experiences that help consumers make important decisions — ones that will ultimately move them funnel down the purchasing funnel.

Going through trade-experiences, payment calculators and scheduling a test drive are all things that have typically been done in-store, but are now being done alone. What’s especially cool about the majority of these experiences is that they often don’t require any large technology overhauls. These are, for the most part, easy integrations.

Now, you might be asking yourself “if consumers are responding so positively to these digital experiences, why wouldn’t I just create a way for consumers to buy their vehicle online?” While that’s definitely a valid question to ask, the majority of consumers out there still want to physically see and test out the vehicle they’re going to invest lots of money into for a period of time.

Of course, this doesn’t mean you CAN’T set up an ecommerce option on your website. There are still those few customers out there who view the process of entering a dealership and haggling as a painful experience. So yes, setting up a way to actually purchase a vehicle CAN be a good idea — BUT you shouldn’t invest too much time in it.

The reason for this is because this will likely only appeal to about 20 to 30 percent of your website traffic. It’s a great way to grab extra deals, for sure — but it shouldn’t be the end all, be all strategy you use.

Don’t completely focus all of your efforts into getting your consumers to complete a transaction online. Instead, worry about getting consumers to complete different experiences (on your website) that will push them down the purchasing funnel, but also get them to come into your store.

What Happens with a Heavily Focused Showroom Strategy?

On the opposite side of the spectrum, your dealership can focus a lot of its efforts on enticing consumers to enter your showroom and catering heavily to consumers visiting your showroom. While technology and ecommerce is certainly an important component to this particular strategy, it isn’t as crucial as assisting consumers on every step of their purchasing journey in person.

Unlike dealerships who lean completely to the right in regards to their strategy (lack of ecommerce options), this slightly center-right strategy can still reap the benefits of ecommerce technology — all while providing a highly personalized approach to consumers that makes them feel like they’re being genuinely being taken care of.

Dealerships who decide to focus their marketing efforts in-store can take advantage of website experiences that allow consumers to make some decisions, but ultimately push them in-store. For example: A consumer who has just went through a payment estimator or trade-in experience might receive a call-to-action that tells them to schedule an appointment fill out a credit application (in store) OR simply take a test drive.

The major benefit of getting your consumers to show up in-store (from your website), is that you have the opportunity to learn more about your consumers immediately (and face-to-face) and they get to learn more about you and your dealership.

There’s something very powerful holding onto that human element. What’s particularly cool about this strategy is that you can learn more about your consumers once they’ve submitted their information, and use it for all your follow-up efforts.

Now, like everything in life, there are negative attributes to this type of strategy. What’s considered extremely positive or negative is very subjective, of course; but your dealership’s “tolerance” for negative outcomes will differ depending on your goals and your consumer base.

Recognize and Deal with Negatives

One negative outcome that could possibly occur is seeing a lack of consumers in your dealership. This would most likely be caused by a lack of understanding of your consumer base. For example: If your primary consumer base consists of young professionals who are always on-the-go, they might not have time to visit your dealership to complete a credit application or fill out a trade-in. They might want to complete the majority of their paperwork online.

Regardless of what side of the spectrum your dealership decides to reside on, you’ll reap your own set of benefits and also hit a few snags along the way. Since every dealership has its own set of goals and has a unique consumer base, it can sometimes be difficult to determine what your strategy should officially look like. Play around with interactive experiences, explore new ways to interact with consumers in-store; and most importantly, never stop observing and changing your strategy.

Russ Chandler
Russ Chandler
Russ has more than 11 years of experience in auto sales, dealership digital marketing and technology product sales. In his current job, he leads the sales and marketing of automotive apps powered by FATWIN for PERQ, a consumer engagement technology provider.

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